TURNING YOUR DAILY NEWS INTO A SNARKY RANT

Qantas in Chaos!

Qantas plans to cut at least 1,000 jobs over the next year after reporting an expected pre-tax loss of up to $300 million in the first half of this financial year.

The airline’s chief executive Alan Joyce says sales have deteriorated during the past few months, as the same time as Qantas has been in a war of words over foreign ownership with its rival Virgin Australia.

“Our November figures have shown us that there continues to be deterioration in the revenue performance of the business and our competitor has just received $350 million, meaning they can continue their uncommercial behaviour,” he told a media teleconference after the announcement.

“We are putting all options on the table in a review of our structure.”

Mr Joyce says the cuts will include 300 jobs already being axed at its heavy maintenance facility near Geelong in Victoria

Qantas has flagged a pre-tax loss of between $245 million and $300 million in the six months to December 31.

It also expects to cut the salaries of Mr Joyce and the company’s board.

It will impose a pay freeze and ban bonuses for all other executives.

Mr Joyce says the airline will do “what ever we need to do to secure the Qantas Group’s future”.

“The challenges we now face are immense – but we will overcome them and we will continue to build a stronger and better Qantas for Australia,” he said.

“Since the Global Financial Crisis, Qantas has confronted a fiercely difficult operating environment – including the strong Australian dollar and record jet fuel costs, which have exacerbated Qantas’ high cost base.”

The company’s share price has plunged by 14.1 per cent after the announcement.

At 10:45am (AEDT) they were trading at $1.03.

Mr Joyce says Qantas is facing strong competition on domestic and international routes.

“Our competitors in the international market, almost all owned or generously supported by their governments, have increased capacity to pursue Australian dollar profits, changing the shape of the market permanently,” he said.

Should the government should run all businesses to protect the employees from bad management decisions? Or maybe the government should pass a special law protecting the jobs of all workers? Or maybe just those who work for an iconic Australian company?

Or maybe Xenophon should just admit that he is a populist pollie on the make, mouthing meaningless platitudes.

The market is an evil thing – sacrificing people all over the place. Time for the government to step in and run things properly. A planned economy would be so much better than the chaos of the market. Why oh why hasn’t this been tried yet?

The airline industry is a tough game but Joyce hasn’t made it easy for himself. Qantas is far bigger than Virgin but he has allowed the airline to outwit him every step of the way. If this latest demonstration of the pain Qantas is suffering doesn’t work, his next card might be to threaten to close international and the many thousands of staff.

There will be a lot of twists and turns in the Qantas saga. Where it will end is anybody’s guess but it will be bloody and brutal.

Perhaps Ricky doesn’t understand that some of us were banned at the Café for objecting to the range of homophobic comments (excused/condoned by the blog admin) directed at Joyce during the last Qantas dispute.

Since Jetstar Asia was Joyce’s and the Board’s idea, which although perhaps a good idea, has become a disaster under them I think it’s now time for Joyce and the Chairman to go and for the Qantas Sale Act to be amended to allow foreign ownership of Qantas.

I mean for fucksake as much as we bleat about closing down that other Aussie icon Holden who the fuck owns it ?

Ok Reb that was a bit harsh, i’m a bit emotional about my shares in the castrated Skippy.. I most wholeheartedly retract and apologise for any offence.

I stupidly went through a spell of buying Aussie shares including Qantas when I was working on a tender for them.

The long term viability of the business was killed by idiotic economic rationalism short term vision.

The downfall started when they closed down there LAME training and pilot schools, then killed of the maintenance & catering business, which was a huge earner for them. Fuel costs and the corporate merged conglomerates they are competing with will see them die a slow painfull death.

This nationalistic sentimental vegemite syndrome is ridiculous and Hokeys platitudes will do nothing to fix what was cast in the market over the past 10 years. You gotta love this government hoisting the flag of free market economy as core ideology then bitching about failing or protecting monopolies controlled by their mates.

I have two mates that worked for Q and they were snapped up in the private sector because of their LAME qualifications.
No being gay has nothing to do with being an incompetent prick who is nothing more than a hatchet man who would outsource taking a piss.

Licensed Aircraft maintenance Engineer. Qantas trained the best in the world. They were the benchmark. The company used to do maintenance for other airlines, now they outsource..since accountants don’t do taxes any more they run the world.

I worked for Price Waterhouse for a while, the beanies got all jealous I had my own office, apparently that was a big thing in beanieland..they were a weird mob.. All fiberal born to rule old boys. They loved me because I saved them shitloads of money, the way to a bean counter is through their wallet… theys get all excited about depreciation while I got all excited about my secretary 🙂

Is Joyce the sol trujillo of the airline industry? Veritably Errol Flynning his way through the industry. Whats wrong with this picture? An incompetent irish free market cowboy with no fucking idea slashing the workforce first to pay for his stupidity rings the sentimental nationalistic icon bell for protectionism. Its the next GM Ford Toyota fiasco Then we Have Corgi Beastiality complaining that News can’t compete with the “leftist” ABC when they have 76% of the market…This lot are genius’s arn’t they. 🙂

Around 1994/5 ish, it was the private super fund of PW, something they set up themselves, I have no idea what it was called. I remember when I joined the company it was part of my package @ 15% non contributory and about six months to a year after I left I got a letter saying so long thanks for the fish. I had an AMP super account which I put my super in on top of it (I have always paid double super since I started work), but I know a few of the partners took a big hit.

***A LAME is a Licensed Aircraft Maintenance Engineer.***
CORRECT
.
***To become a LAME you require an aircraft trade,***
ie engine OR airframe OR INSTRUMENT(electronics/avionics.)
Each one is a specialty, the workers have no hope in hell of qualifying in all `fields` and keeping-up with the alterations, up-grades, alterations etc,
.
***Beyond this qualification a lengthy work record on various aircraft is required- a Schedule of Experience.***
Must be kept by Law, mandatory.
.
Once this is completed there is a lengthy course on an aircraft type, lasting several months. A separate course is required for EACH OF the various different models of 747s, 767s, 737s,(boeings) each type of Airbus.
.
***The commitment to this training is huge and expensive.***
***LAMEs earn huge incomes.***
Compared to what.? Obviously not the boardroom.
.
***In most airlines they are used mainly for oversight.***
adamair
***In Qantas they’re mainly hands on.***
casa.? Required by Law, just as other Licensed people are required `by-Law` to do the work in other fields/industry`s, plumbers, shotfirers, electricians, gas-workers, welders, machine/truck drivers.
.
***This is a stupid waste of an expensive resource.***
Qantas verses adamair and the rest of the airlines that have used plenty of passengers as crash-test dummy`s.

‘THE biggest airline in Asia, state-owned China Southern, held detailed discussions last year to bankroll a group of wealthy investors – including former Qantas chief executive Geoff Dixon, adman John Singleton and retail king Gerry Harvey – to buy a cornerstone shareholding in the national carrier.

‘The Weekend Australian understands the powerhouse Asian carrier was introduced to the consortium by billionaire trucking magnate Lindsay Fox and that Mr Dixon held discussions with China Southern chairman Si Xianmin, encouraging the Chinese to provide financial backing for the syndicate, which had acquired a stake of about 2 per cent in Qantas.’

I suppose I should be grateful that 7.30 provides an opportunity to illustrate the lack of general knowledge of aviation in the public. But somehow, I’m not.

For any airline to operate in Australia it must have CASA approval of its maintenance and approval airworthy systems, without this the airline can’t fly in our airspace.

So when Virgin gets its heavy maintenance done in Vietnam or China, or Thailand or India, does he think that it’s all done by our LAMEs or perhaps that the work is mainly performed by their own labour but supervised by people with licences that meet CASA requirements?

… and perhaps 730 would explain why AMWU, AWU and ETU have lobbied for an overhaul of the aircraft licences systems, as the current structure limits the skill and career development of their members.

Perhaps you could explain why that’s a bad thing, ToM?

And in similar vein … what a pity anyone without qualifications can become a manager or consultant … if a business degree was involved we might get better outcomes … at least they’d understand something on planning, leading, organising and controlling … rather than marketing and simple cost cutting …

LAMEs are very, very expensive TB and other airlines use the capability to oversee the maintenance work, which is performed in Australia by well paid tradesmen who have spent years learning to work on aircraft.

As you probably recall, best practice normally means that tradespeople sign off their own work, but here that isn’t possible. Tradesman can’t sign off their own work as complete. A LAME does that.

It’s an archaic approval structure and only exists to fortify union coverage and allow LAMEs to gain a financial windfall.

‘ ‘ ‘ ‘For any airline to operate in Australia it must have CASA approval of its maintenance and approval airworthy systems, without this the airline can’t fly in our airspace.’ ‘ ‘ ‘

But once they receive `casa` approval, the `corporate-airline` is then free to `out-source` their maintenance to `outside` contractors, just as every other `corporate` does. As the chain of `out-sourcing` gets longer, the ability to retain `quality`/safety control plummets.

30 years of `out-sourcing` in the textile and footwear industry, now `nearly` guarantees (just-about) every shoe or shirt most of us buy is produced in, sweatshop, child-worker, slavery supplied.

.
‘ ‘ ‘ ‘heavy maintenance done in Vietnam or China, or Thailand or India, does he think that it’s all done by `our` LAMEs’ ‘ ‘ ‘
lt will be done under `that` nations laws and regs. `Free-trade` anus flexing then lets the other nation do a trade `swap`, you-let-us, and we will let you. Don`t count on the inspection regime and quality control being the `decision`/deal maker.

‘ ‘ ‘ ‘the work is mainly performed by their own labour but supervised by people with licences that meet CASA requirements?’ ‘ ‘ ‘

As l said previously, adamair. You might do better finding which `airlines` and which `nations` have had their `air-space` permissions retracted/canceled, and why.

What is lndonesia`s airline permission status yomm.?
And what country has the Australian `out-sourcing` gone to.?
And what is the status of that country.?

Qantas has made some large mistakes, just like Ansett, they have old 767 aircraft, take to long to get new aircraft, never ahead of the competitors with in-flight products. A big mistake was join forces with Emirates, Qantas joined forces with a player which is too big, I keep seeing the future of qantas being owned by Emirates, no kangaroo on the tail but a camel….
The qantas alliance fit should be British Airways, Cathay and Qatar all one world airlines. Qatar is a fairly young airline, the alliance would help both carriers , currently I see to much capacity on the Sydney-Dubai etc., I read somewhere that qf a380 aircraft are not full heading to Dubai?

I live in perth, it’s a disgrace, qantas only flys once a day out of perth to singapore, that’s right Australian Airline, they only fly 1 time a day, no more Hong Kong, Japan, Bali.
Etc

Qantas is letting the competitions take over, qantas use to fly 2 times daily to singapore, ever since they cancelled one flight
Singapore airlines flys min. 3 times a day some days 4 , tiger increased to 2 daily and now scoot started daily, and soon most likely double daily

I flew Qantas return to Bangkok and it was like taking a trip back in time. The aircraft was a relic from the past.

While other more progressive airlines have large touch screen onboard entertainment screens, this Qantas plane had those tiny little screens the size of a cigarette box with the stupid remote control attached to the seat with a retractable cord.

n all the noise about the travails affecting Qantas – high labour costs, fuel, state-owned and hugely resourced global competitors from China and the Middle East – very little is mentioned about strategic errors from management or the board.

In the past five years, it has deliberately alienated customers, conducted a war of attrition with its employees and bitterly disappointed its shareholders. Management, meanwhile, has been handsomely rewarded.

According to none other than the chairman of the particular tourism forum, Liberal MP for Wannon Dan Tehan, Joyce said the Qantas Sale Act was preventing it from further capital raising. This is nonsense. Qantas never had the slightest problem making capital raisings — most of them oversubscribed, under the “restrictive” Qantas Sale Act — until the current management took over five years ago.

It was often argued that the QSA actually improved the attractiveness of Qantas to overseas investors because it guaranteed that at least 51% of the enterprise would be supported by Australian investors on the share register because of the cap on foreign domiciled shareholders. Qantas raised $1.2 billion from offers that were often jointly supported by domestic and foreign investors in nine offers pre-Joyce.

“Strange that all the companies in the news in trouble have strong Unions.”

Not strange at all. Companies protected by subsidies or monopoly status can, in the short term at least, pass on the costs. Typically management of such enterprises has grown fat and lazy, not having to face market forces. They are only too willing to be extorted by Unionland thugs.

No one, least of all ripped-off consumers, will shed a tear when Ponzi scheme ends in the destruction of businesses that might otherwise have survived under competent management.

What unique rights and/or obligations does Qantas have as Australia’s so-called “national carrier”? This term gets used a lot to justify proposed special treatment for Qantas. Does it have any meaning, or is it just a carry over from before privatisation, when Qantas was government owned?

The Government uses tax payers dollars to prop up a business that has shown it is reckless with money, and, as soon as they get their Guarantee, sack 5,000 people. The Government REFUSE to help companies who will save jobs with tax payer dollars.

We, the taxpayer, are now actually paying to destroy jobs rather than save them. This is the Government we have voted in.

Internationally it has to compete with completely different cost structures (i.e. lower) and now it cannot differentiate its product enough to coax customers to choose it over much cheaper rivals. Afterall most airlines are now the safest they have ever been and the aircraft themselves don’t need as much maintenance these days. Even Garuda has cleaned up its act.

Domestically it still makes money because its competitors are subject to base similar cost structures but they are crucially without the featherbedding and inflexibilty which has built up over the years that Qantas has to endure.

Joyce should go plus most of the Board because their venture into Asia has been a disaster and I don’t think people really like flying through a Middle Eastern city (clash of culture ?) compared to going via Singapore or Bangkok where there is greater “Western tolerance”.

I certainly wouldn’t like it but since my last Qantas flight when my bread roll was lobbed by the hostess over the heads of 2 adjoining passengers rather than passed over in a civilized manner* we fly Singapore/Thai/Malaysian anyway.

Qantas suffers from a range of ailments, including-
• Some of the route planning has been unsuccessful
• Some of the choices in aircraft and fleet configuration have not been ideal

However, its cost structure is entirely unsatisfactory-
• Direct employment of ground staff, and all the bells and whistles that goes with the airline industry. Competitors contract out similar functions. Qantas even employs its own catering division churning out poor food.
• Poor structure of its engineering and maintenance workforce, with too many that are paid too much, overlaid with classification/pay/union driven training. Other airlines sue these highly skilled people sparingly, for oversight rather than for hands on mechanical work.
• Overburdened with middle management types, who are often covered by a union award.
• Capacity limitations, with operations based in the congested and costly Mascot area.
• Highly paid cabin crew, who make as much out of their meal/travelling allowances as they do in wages.

Qantas requires more offshore outsourcing to lower its cost base. There are Malaysian and Vietnamese support organisations that are able to carry out route planning, aircraft maintenance, back office functions, just as capably as people n Mascot, but at a much lower cost.

That’s the future of Qantas, unfortunately, because many of the employees haven’t valued their company or their jobs.

I listened to Dick Smith on the ABC this morning, interviewed by Jon Faine, Smith was interviewed as an “aviation expert”

Faine got a little bothered because Smith said Qantas could not compete with airlines that paid their pilots half our rates and cabin crew 10%. He said that Qantas need to source more of its labour out of Asia.

People in Qantas have great jobs, but they’re generally isolated from the reality of employment conditions in other industries, and in other parts of the international aviation industry.

Largely Qantas people don’t value their company or their jobs sufficiently. Holden, Ford, Toyota, Alcoa, SPC… should form some type of wake up call for them, but I suspect the unionised employees remain delusional.

Neocon neoliberalism; read the final Orgill Report and extrapolate; if government(s) don’t own or do nuthin’ any more, and nuthin’ of any considerable standard, neither does anyone else, especially the much-vaunted private sector, perty much. But you probably missed that key observation, since nobody from the MSM reported it; and now those same forward thinkers of the past thirty years, from both major parties, want to trash the ABC to improve standards; and to trash just about anything else left they can spin off into oblivion, to complete the best-and-worst-of-all-possible-worlds outcome. Or something like that. Oh, and without better or even adequate information, you too can be ‘not even an informed purchaser’, these days; not about government, not about the private sector, not about anything. really; and so it goes in the free choice future.)

Adjusting to a global economy. And, we always fought to keep things here, now, we actively participate into forcing them offshore

We did have a viable manufacturing industry. It was re-adjusting its size to fit in with the global economy. It could/would have survived with two car manufacturers, three was always a stretch, particularly when the parent company is suffering. Never before has a Government actively engaged in chasing jobs offshore in such an ideological manner. It is a national shame that they have chosen ideology over peoples livelihood.

Qantas, however, was also a viable concern, until joyce got hold of it and drove it into the ground.

Saving the airline is easy: Double staff wages; double the number of staff; ask the government to pay for it. Keep some of that for management and shareholders and everyone is happy. What’s not to like about that?

My feeling is that joyce cosied up to abbott and co long before they got into power and a stitch up deal was done then. That is why we had the big lock out and customers were stranded. We are now seeing the end of the drama play out exactly as rehearsed pre election. Don’t for one minute think this isn’t another attack on the workers as planned by the qantas board and the libs.

gra_x2 1:32 PM on 28/02/2014
OK – There are 2 big problems in all of this that gets totally lost in the rhetoric.
1) “Wages” are too high. Which “wages” are people talking about? Treating it as a catch all is crazy. Yes there are undoubtedly some industries where staff costs are far too high for the work being done. But it is hard to argue that some of the lowest paid and most vulnerable are overpaid for what they do.

2) We either believe in the free market or we don’t. At the end of the day companies sell their product for the highest price the market will bare. It is not a cost plus model. Why should workers not be able to sell their labour at the highest price they can get? Gina bangs on about the high cost of labour whilst making record profits. You can’t have it both ways. Mine workers were able to extract those wages based on supply and demand as well.

Cost reduction and maximising profit is the aim of any business. The low hanging fruit is direct costs so the lazy companies go after that. And aussie companies are generally lazy. The hard earned gains come from process improvement and innovation. Look at Germany etc. High cost but ultra efficient. Look at the US – Low cost, socially splintered and going out backwards.

You want to see efficiency and productivity fall? Treat your staff as a commodity. You watch, you can remove all the protections entirely and poorly run inefficient companies will still fail. Innovation people!

If Australia wants to be a high wage country, it needs to develop a reputation as one with a very reliable workforce. Australia might have a reasonably skilled workforce, but it was a well earned reputation for unreliability and chain dragging.

No one with a few billion to invest seriously thinks about putting it into any of Australia’s non mining industries, and that is significantly because our reputation for reliability is polluted.
———– Sack the board and Joyce and sell what’s left to Singapore Airlines.

That’s a likely outcome, and the sell it to Singapore bit will be a little sad.

”””””””””’Haven’t you figured it out yet? ‘High dollar’ means high wages, on international comparison.”””””””””correct

Haven’t you figured it out yet?

High property/home prices require high wages,

FACT, PEOPLE NEED A HOME,
thus, ultra-cheap rental/purchase program needed for the ultra-low-paid you advocate FOR yomm, your road-map to detroit will only provide higher homeless rates and crime rates, but no solutions flow out from your cubicle

Some examples of domestic costs incurred by citizens-
• Shelter/Home, rental or purchase
• Energy Utility/s, Electric and/or Gas
• Transport, Vehicle with Insurance and Rego to `get` to shit-job (petrol,lots)
• Food and Grocery`s (we need to eat)
.
All increasing much faster than those of us on the bottoms `earnings`

• The ALP is pathetic for seeking to continue to load it up with a shocking range of inefficiencies about where is can get its catering, maintenance, admin done. That’s just pandering to union driven inefficiency.

• The government is pathetic for not having an interim plan, to assist Qantas stabilised while it seeks the lifting of the burdensome legislative changes.

Even after getting rid of 5,000 people, Qantas will still employ almost 30,000 people, in good, well paid jobs with outstanding airline benefits.